STAND. COM. REP. NO.  1373

Honolulu, Hawaii

                , 2007

RE:   S.B. No. 1654

      S.D. 1

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Fourth State Legislature

Regular Session of 2007

State of Hawaii

Sir:

     Your Committee on Consumer Protection & Commerce, to which was referred S.B. No. 1654, S.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO CONDOMINIUM MANAGEMENT DISPUTE RESOLUTION,"

begs leave to report as follows:

     The purpose of this bill is to provide a less-expensive, quicker means of resolving condominium disputes by reinstating the Condominium Dispute Resolution Pilot Project (Pilot Project) established by Act 164, Session Laws of Hawaii (SLH) 2004.

     The Department of Commerce and Consumer Affairs (DCCA), Hawaii Independent Condominium & Cooperative Owners, Hawaii Legislative Action Committee of the Community Associations Institute, Hawaii Council of Associations of Apartment Owners, and a concerned individual testified in support of this bill.

     Your Committee finds that the Pilot Project provided an administrative hearing process under DCCA for disputes failing mediation under section 514A-121.5, Hawaii Revised Statutes (HRS).  The Pilot Project, including the mediation process under section 514A-121.5, HRS, was repealed on June 30, 2006, leaving several pending cases unresolved. 

     Although a similar dispute resolution process was established by Act 277, SLH 2006, that process, scheduled to sunset on June 30, 2009, only applies to condominiums created after July 1, 2006, and governed by chapter 514B, HRS, pursuant to section 514B-21, HRS, unless the condominium owners amend their governing documents pursuant to 514B-23, HRS, and adopt chapter 514B, HRS.  This bill reenacts the Pilot Project to provide a condominium dispute resolution process for cases involving condominiums governed by chapter 514A, HRS, including cases pending before DCCA that were dismissed due to the repeal of the Pilot Project.

     As affirmed by the record of votes of the members of your Committee on Consumer Protection & Commerce that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 1654, S.D. 1, and recommends that it pass Second Reading and be referred to the Committee on Judiciary.

Respectfully submitted on behalf of the members of the Committee on Consumer Protection & Commerce,

____________________________

ROBERT N. HERKES, Chair